Financier George Soros hoped that the collapse of the Soviet Union would lead to what he calls “open societies”. But by 2000 he was already warning:
Perhaps the greatest threat to freedom and democracy in the world today comes from the formation of unholy alliances between government and business. This is not a new phenomenon. It used to be called fascism…The outward appearances of the democratic process are preserved, but the powers of the state are diverted to the benefit of private interests.
This ever-closer merging of the capitalist state, politics and economics is one of the most significant consequences of globalisation. We have witnessed the transition from a welfare to a competition or market state in parallel with the dramatic changes to the structure of the global economy. Now the state sees its role as directly promoting the market economy, while handing over decision-making to non-elected bodies like the WTO.
Whole areas of public services and industries are privatised. Public projects like schools and hospitals are themselves conditional on private finance and contracts that guarantee fantastic returns at no risk.
The market now penetrates every area of what was the welfare state, including housing, health, dentistry, public transport and legal aid.
At the same time, a mounting authoritarianism, introduced under the cloak of the “war on terror”, has swept away many democratic rights.
Representative government is reduced to a sham, helping to create an historic crisis of legitimacy of the current state system of rule in Britain and elsewhere.
New Labour especially champions the ideology of global capitalism.
Gordon Brown told financiers just before becoming prime minister that history would record that the government had helped put to work “that set of qualities that is needed for global success”. According to Brown, these were “openness to the world and global reach”, being “pioneers of free trade”, having “a deep and abiding belief in open markets” as well as
“flexibility and adaptability to change”. Within a few weeks, the same government was bailing out Northern Rock!
Many of the state’s activities are directed towards the globalisation project. Take education. In the same speech, Brown told the City fat cats:
“Only with investment in education can open markets, free trade and flexibility succeed… If we can show people that by equipping themselves for the future they can be the winners not losers in globalisation… then people will welcome open, flexible, free trade and pro-competition economies as an emancipating force.”
The practical result of the transition to a market, competition state is that notions that capitalism can be reformed through parliamentary activity are inconceivable. Labour, which was a party based on class compromise and wringing some concessions from the ruling classes, is now New Labour – the party of choice for the global élites operating in Britain, at least for the time being.
References
1. Intergovernmental Panel on Climate Change http://www.ipcc.ch/index.html 2. Climate Change 2007: The Physical Science Basis, Summary for Policymakers, Intergovernmental Panel on Climate Change, http://www.ipcc.ch/SPM2feb07.pdf 3. Stern Review http://www.hm-treasury.gov.uk/independent_reviews/stern_review_
economics_climate_change/sternreview_index.cfm
4. http://uk.reuters.com/article/environmentNews/idUKSYD21253520070829 5. Pollution From Chinese Coal Casts a Global Shadow, New York Times, 11 June 2006 http://www.nytimes.com/2006/06/11/business/worldbusiness/11chinacoal.html?ex=130767 8400en=e9ac1f6255a24fd8ei=5088partner=rssnytemc=rss
6. The World Distribution of Household Wealth, World Institute for Development Economics Research of the United Nations University (UNU-WIDER) 5 December 2006,
http://www.mindfully.org/WTO/2006/Household-Wealth-Gap5dec06.htm 7. Global Strategy on Diet, Physical Activity and Health
http://www.who.int/dietphysicalactivity/publications/facts/obesity/en/
8. The Extent, Nature and Effects of Food Promotion to Children: A Review of the Evidence Technical Paper prepared for the World Health Organization, Gerard Hastings, Laura McDermott, Kathryn Angus, Martine Stead and Stephen Thomson, Institute for Social Marketing, University of Stirling & The Open University, United Kingdom July 2006 9. The faces of poverty: Malnourished, hungry, and obese? Obesity 26 August 2002 http://www.obgyn.net/newsheadlines/headline_medical_news-Obesity-20020826-7.asp 10. Naomi Klein, The Shock Doctrine: The Rise of Disaster Capitalism, Allen Lane 2007
Many groups, as well as distinguished individuals, appalled in one way or another by what global capitalism has done to the planet, believe that the solution lies in a mixture of regulation, state intervention, new global governance and changes to the way corporations operate.
In essence, they argue that if only we could tame the beast, draw the sting from transnational corporations and financial institutions, the world would be a better place. We would then have a kinder, gentler globalisation that would benefit all of human kind.
Advocates of this capitalism with a human face include the leading economics professor Joseph Stiglitz, who once advised the World Bank, pressure groups such as the World Development Movement (WDM), Greenpeace, the Campaign Against Climate Change and Oxfam, as well as the International Labour Organisation (ILO). In a major 2004 report, the ILO calls for a “fair globalisation” to create “opportunities for all” and says: “We judge that the problems we have identified are not due to globalisation as such but to deficiencies in its governance.”
[emphasis added] In 190 pages of text, analysis and graphs, the ILO unbelievably fails to apply the term capitalism even once to the study of globalisation and its social impact.